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Business Segments
 3 Months Ended
Mar. 31, 2021
Segment Reporting [Abstract]  
Business Segments Business Segments
The Company's property and casualty commercial insurance operations are managed and reported in three business segments: Specialty, Commercial and International. These three segments are collectively referred to as Property & Casualty Operations. The Company's operations outside of Property & Casualty Operations are managed and reported in two segments: Life & Group and Corporate & Other.
Effective January 1, 2021, and in connection with the ceding of certain legacy reserves under a retroactive reinsurance agreement executed in February 2021, management changed the segment presentation of a legacy portfolio of excess workers’ compensation policies relating to business written in 2007 and prior. This business, which was previously reported as part of the Commercial business segment, is now reported as part of the Corporate & Other business segment. Further information on this retroactive reinsurance agreement is provided in Note E. In addition, a determination was made to change the segment presentation of certain legacy mass tort reserves. Similar to the aforementioned excess workers’ compensation legacy business, these legacy mass tort reserves were previously reported in the Commercial business segment and are now reported as part of the Corporate & Other business segment. These changes were made to better reflect the manner in which the Company is organized for purposes of making operating decisions and assessing performance. Prior period information has been conformed to the new segment presentation.
The accounting policies of the segments are the same as those described in Note A to the Consolidated Financial Statements within CNAF's Annual Report on Form 10-K for the year ended December 31, 2020. The Company manages most of its assets on a legal entity basis, while segment operations are generally conducted across legal entities. As such, only Insurance and Reinsurance receivables, Insurance reserves, Deferred acquisition costs, Goodwill and Deferred non-insurance warranty acquisition expense and revenue are readily identifiable for individual segments. Distinct investment portfolios are not maintained for every individual segment; accordingly, allocation of assets to each segment is not performed. Therefore, a significant portion of Net investment income and Net investment gains or losses are allocated primarily based on each segment's net carried insurance reserves, as adjusted. All significant intersegment income and expense have been eliminated. Income taxes have been allocated on the basis of the taxable income of the segments.
In the following tables, certain financial measures are presented to provide information used by management to monitor the Company's operating performance. Management utilizes these financial measures to monitor the Company's insurance operations and investment portfolio.
The performance of the Company's insurance operations is monitored by management through core income (loss), which is derived from certain income statement amounts. The Company's investment portfolio is monitored by management through analysis of various factors including unrealized gains and losses on securities, portfolio duration and exposure to market and credit risk.
Core income (loss) is calculated by excluding from net income (loss) the after-tax effects of net investment gains or losses and any cumulative effects of changes in accounting guidance. The calculation of core income (loss) excludes net investment gains or losses because net investment gains or losses are generally driven by economic factors that are not necessarily reflective of our primary operations.
The Company's results of operations and selected balance sheet items by segment are presented in the following tables.
Three months ended March 31, 2021
Specialty
Commercial		InternationalLife &
Group		Corporate
& Other		  
(In millions)EliminationsTotal
Operating revenues 
Net earned premiums$735 $855 $252 $120 $— $— $1,962 
Net investment income117 148 14 219 6 — 504 
Non-insurance warranty revenue338 — — — — — 338 
Other revenues— 5 — 1 1 (2)5 
Total operating revenues1,190 1,008 266 340 7 (2)2,809 
Claims, benefits and expenses      
Net incurred claims and benefits427 639 155 281 (2)— 1,500 
Policyholders’ dividends1 5 — — — — 6 
Amortization of deferred acquisition costs154 153 52 — — — 359 
Non-insurance warranty expense311 — — — — — 311 
Other insurance related expenses70 115 35 25 10 — 255 
Other expenses11 9 (5)2 42 (2)57 
Total claims, benefits and expenses974 921 237 308 50 (2)2,488 
Core income (loss) before income tax216 87 29 32 (43)— 321 
Income tax (expense) benefit on core income (loss)(46)(18)(5)4 7 — (58)
Core income (loss) $170 $69 $24 $36 $(36)$— 263 
Net investment gains (losses)57 
Income tax (expense) benefit on net investment gains (losses)(8)
Net investment gains (losses), after tax49 
Net income (loss)$312 
March 31, 2021
(In millions)      
Reinsurance receivables$957 $859 $300 $389 $2,628 $— $5,133 
Insurance receivables1,004 1,322 357 2 — — 2,685 
Deferred acquisition costs340 299 102 — — — 741 
Goodwill117 — 31 — — — 148 
Deferred non-insurance warranty acquisition expense3,149 — — — — — 3,149 
Insurance reserves 
Claim and claim adjustment expenses5,916 8,449 2,142 3,726 2,823 — 23,056 
Unearned premiums2,666 1,930 588 135 — — 5,319 
Future policy benefits— — — 12,772 — — 12,772 
Deferred non-insurance warranty revenue4,119 — — — — — 4,119 
Three months ended March 31, 2020
Specialty
Commercial		InternationalLife &
Group		Corporate
& Other		  
(In millions)EliminationsTotal
Operating revenues 
Net earned premiums$685 $818 $239 $127 $— $— $1,869 
Net investment income56 42 15 208 8 — 329 
Non-insurance warranty revenue301 — — — — — 301 
Other revenues1 8 — — 1 (2)8 
Total operating revenues1,043 868 254 335 9 (2)2,507 
Claims, benefits and expenses    
Net incurred claims and benefits405 555 154 316 (11)— 1,419 
Policyholders’ dividends1 5 — — — — 6 
Amortization of deferred acquisition costs151 144 49 — — — 344 
Non-insurance warranty expense281 — — — — — 281 
Other insurance related expenses69 127 36 26 — — 258 
Other expenses13 6 13 3 39 (2)72 
Total claims, benefits and expenses920 837 252 345 28 (2)2,380 
Core income (loss) before income tax123 31 2 (10)(19)— 127 
Income tax (expense) benefit on core income (loss)(27)(8)— 14 2 — (19)
Core income (loss)$96 $23 $2 $4 $(17)$— 108 
Net investment gains (losses)(216)
Income tax (expense) benefit on net investment gains (losses)47 
Net investment gains (losses), after tax(169)
Net income (loss)$(61)
December 31, 2020
(In millions)
Reinsurance receivables$886 $848 $302 $390 $2,052 $— $4,478 
Insurance receivables1,052 1,254 328 4 2 — 2,640 
Deferred acquisition costs330 281 97 — — — 708 
Goodwill117 — 31 — — — 148 
Deferred non-insurance warranty acquisition expense3,068 — — — — — 3,068 
Insurance reserves 
Claim and claim adjustment expenses5,748 8,250 2,091 3,743 2,874 — 22,706 
Unearned premiums2,635 1,824 546 114 — — 5,119 
Future policy benefits— — — 13,318 — — 13,318 
Deferred non-insurance warranty revenue4,023 — — — — — 4,023 
The following table presents operating revenues by line of business for each reportable segment.
Three months ended March 31
(In millions)20212020
Specialty
Management & Professional Liability$667 $568 
Surety142 138 
Warranty & Alternative Risks381 337 
Specialty revenues1,190 1,043 
Commercial
Middle Market375 335 
Construction309 250 
Small Business126 112 
Other Commercial198 171 
Commercial revenues1,008 868 
International
Canada79 73 
Europe111 92 
Hardy76 89 
International revenues266 254 
Life & Group revenues340 335 
Corporate & Other revenues 7 9 
Eliminations(2)(2)
Total operating revenues2,809 2,507 
Net investment gains (losses)57 (216)
Total revenues$2,866 $2,291